Title XVI – INVESTIGATIONS, OFFENSES, AND PENALTIES

1. I. An independent auditor who, in collusion with the corporation’s Directors or representatives,

certifies the corporation’s financial Statements despite its incompleteness or inaccuracy, its
failure to give a pair and accurate presentation of the corporation’s condition, or despite
containing false or misleading statements, shall be punished with a fine Ranging from
P80,000.00 to P500,000.00.

II. Those responsible for the formation of a corporation through fraud, or who assisted directly or
indirectly therein, shall be punished with a fine ranging from P200,000.00 to P2,000,000.00.

a. Only I is true

b. Only II is true

c. Both are true

d. Both are false

2. I. A corporation that conducts its business through fraud shall punished with a fine ranging
from P200,000.00 to P2,000,000.00.

II. A Corporation used for fraud, or for committing or concealing graft and corrupt practices as
defined under pertinent statutes, shall be liable for a fine ranging from P100, 000.00 to P5,
000,000.00.

a. Only I is true

b. Only II is true

c. Both are true

d. Both are false

2. I. A director, trustee, or officer who knowingly fails to sanction, report, or file the appropriate
action with proper agencies, allows or tolerates the graft and corrupt practices or fraudulent acts
committed by a Corporation’s directors, trustees, officers, or employees shall be punished with a
fine ranging from P500,000.00 to P1,000,000.00.

II. If the offender is a corporation, the penalty may, at the discretion of the court, be imposed
upon such corporation and/or upon its director, trustees, stockholders, members, officers, or
employees responsible for the violation or indispensable to its commission.

a. Only I is true

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 b. Only II is true

c. Both are true

d. Both are false

4. I. The unauthorized use of a corporate name shall be punished with a fine ranging from
P10,000.00 to P200,000.00.

II. When, despite the knowledge of the existence of a disqualification, a director, trustee or
officer willfully holds office, or willfully conceals such disqualification, such director, trustee or
officer shall be punished with a fine ranging from P10,000.00 to P200,000.00 at the discretion of
the court, but shall not be permanently disqualified ground for from being a director, trustee or
officer of any corporation.

a. Only I is true

b. Only II is true

c. Both are true

d. Both are false

5. I. The unjustified failure or refusal by the corporation, or by those responsible for keeping and
maintaining corporate records, to comply on the inspection and reproduction of records shall be
punished with a fine ranging from P10,000.00 to P200,000.00, at the discretion of the court,
taking into consideration the seriousness of the violation and its implications.

II. Any person who willfully certifies a report required under the revised Corporation Code,
knowing that the same contains incomplete, inaccurate, false, or misleading information or
statements, shall be punished with a fine ranging from P20,000.00 to P200,000.00.

a. Only I is true

b. Only II is true

c. Both are true

d. Both are false

6. It refers to any person who provides truthful information relating to the SEC or possible
commission of any offense or violation under the revised Corporation Code.

a. Whistleblower

b. Intermediary

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 c. Mediator

d. Conciliator

7. I. The SEC may investigate an alleged violation of the Revised Corporation Code, or of a rule,
regulation, or order of the SEC.

II. The SEC may administer oaths and affirmations, issue subpoena and subpoena duces tecum,
take testimony in any inquiry or investigation.

a. Only I is true

b. Only II is true

c. Both are true

d. Both are false

8. I. Whenever the SEC has reasonable basis to believe that a person has violated, or is about to
violate the Revised Corporation Code, a rule, regulation, or order of the SEC, it may direct such
person to desist from committing the act constituting the violation.

II. The Commission may issue a cease and desist order ex parte to enjoin an act or practice which
is fraudulent or can be reasonably expected to cause significant, imminent, and irreparable
danger or injury to public safety or welfare.

a. Only I is true

b. Only II is true

c. Both are true

d. Both are false

9. I. Any person who, without justifiable cause, fails or refuses to with any lawful order,
decision, or subpoena issued by the SEC shall, after due notice and hearing, be held in contempt
and fined in an amount not exceeding P30,000.00.

II. When the refusal amounts to clear and open defiance of the Commission's order, decision, or
subpoena, the SEC may impose a daily fine of P1, 000.00 until the order, decision, or subpoena
is complied with.

a. Only I is true

b. Only II is true

C. Both are true

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 d. Both are false

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